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Know about your Advance Tax

If you are having income other than salary like earnings from capital gains, interest on deposits, investments, lottery, house property or business, then you are required to pay advance tax. Advance tax is the part of yearly tax which is to be paid in advance than is “Pay as you earn”.

If you have sources of income other than salary which increases your tax liability to more than Rs 10000, then you will have to pay advance tax. This scheme applies mainly to the self employed or professionals, business persons, companies and corporate

To pay advance tax you need to visit any of the 926 assigned branches in India that accept advance tax payment and use the tax payment challan or you can pay your advance tax online also through the income tax department or national security depository service site. Currently you can deposit in any of the branches of the banks like Reserve bank of India, State Bank of India, ICICI bank, Indian overseas bank, Indian Bank, etc.

If you are a corporate then you have to pay advance tax 4 times a year on 15th of June, September, December and March while non-corporates are required to pay 3 times a year on 15th of September, December and March in 3:3:4 ratio. If you get rebate on the tax paid, you will get interest on the income tax refund at the rate of 12% per annum and also if you don’t pay advance tax, you need to pay fine at the same rate of interest.